Section 2 Calculations. 5pt each part, 50 pts total. Show your work, no work = 0 pt! Do not round your work.

For 1, 2, 3, 4 & 5: A newspaper provides spot exchange rate of $1 = .7555 and 1-year forward rate of $1=.7755. Youll also need to use the additional information provided in the problems.

4) Suppose that the interest rates are 3% APR in the UK. Under IRP, what is the no-arbitrage 1-year interest rate in the US, in percent round to 2 decimal places?

Section 2 Calculations. Spt each part, 50 pts total. Show your work, no work = 0 pt! Do not round your work. For 1, 2, 3, 4 & 5: A newspaper provides spot exchange rate of $1 = .7555 and 1-year forward rate of $1=.7755. You'll also need to use the additional information provided in the problems. 4) Suppose that the interest rates are 3% APR in the UK. Under IRP, what is the no-arbitrage 1-year interest rate in the US, in percent round to 2 decimal places